The ambitious goal of Milgate and Stimson is to demonstrate how classical political economy “sought to influence and alter the understanding of politics and political life,” especially in Britain (p. 1). They produce a very careful and detailed analysis of early economists’ ideas on issues shaping the modern concept of the political order, in the process displaying a rich array of competing ideas. Milgate and Stimson cast a wide net, catching in it thinkers around the edges of economics, especially the Utilitarian philosophers and a variety of other reformers. However, discussion of continental Europeans and Americans is sparse. Milgate and Stimson use Adam Smith as a benchmark for the developments they discuss, although later ideas often deviated significantly from Smith’s due to his eighteenth-century outlook. Indeed, Milgate and Simson are very systematic in exposing how various later writers, who sometimes cloaked their ideas in Smith’s authority, were simply attributing to Smith what wasn’t unambiguously there. Consider the authors’ approach on a few topics they examine.

A major early chapter addresses the uneasy relationship between the concept of civil society and economic society. Prior to Smith, feudal thinkers and mercantilists had interpreted both civil and economic developments through the lens of state, or government, actions. Their premise was that society operated only with intentional control from the top. However, if society had its own inner, independent dynamic, then any state role would be greatly diminished; further, any explicit public morality, or virtues, would become irrelevant.

It was precisely this latter view ? that society has its own inner dynamic ? that the political economists advocated, thereby revolutionizing the concept of civil society. For Smith, the market system, at the center of society, diminished the significance of “both the state and the direct influence of statesmen” (p. 48). In addition, public virtues were displaced; for Smith, morals reflected the highly particular and individual relationships that people developed with those closest to themselves. Yet, according to Milgate and Stimson, Smith did not go to the extreme in which “the concept of the self-regulating market … came to play the more politically constraining role” that eventually emerged with modern economics (p. 50). David Ricardo added a new element to the notion of the self-guiding market system, arguing that economic classes, not individuals, were the relevant locus of economic and social action. This sharply contradicted the harmonious individualism of many other early economists’ theories. Milgate and Stimson consistently demonstrate that classical economics opened the door to multiple interpretations of civil society.

This richness of possibilities, however, was killed by the ultimate arrival of neoclassical economics. Milgate and Stimson put it this way: “Economics moved from thinking of civil society composed of social classes, professional groups, corporate entities, trade unions, and cooperative societies, to a civil society of isolated individual utility maximizers” (p. 56; emphasis added). They quote Ronald Meek approvingly: “the new starting point became, not the socioeconomic relations between men as producers, but the psychological relation between men and finished goods” (p. 58). In short, civil society was reduced to a neoclassical oxymoron as the isolated castaway Robinson Crusoe became their favored model of what was worth understanding about society! Milgate and Stimson obviously find that true political economy died with the ascendancy of neoclassical economics. They are not any kinder to the various theories of society (e.g., public choice) that have lately emerged from the neoclassical perspective. Their conclusion on the neoclassical vision: no social values exist beyond efficiency, no moral or social obligation remains, only arbitrary individual preferences matter, and anti-institutionalism saturates the literature (p. 59). For Milgate and Stimson, classical economics is always seen in tension with neoclassical theory.

Another significant political issue (covered in two chapters) was extension of the franchise in early nineteenth-century Britain. Milgate and Stimson give major attention to James Mill and David Ricardo, who each favored widening the electorate, but for very different reasons. Because everyone’s individual utility mattered to Mill, government by the rich was intolerable from a Utilitarian perspective. Yet, equally intolerable would be a vote for the ignorant, or those with no stake in the community, thus leaving out the large poor and working classes. Mill, however, favored the vote for the (reliable and safe) middle classes. Before being enfranchised, workers and the poor would need to be educated to know their own true interests, which Mill blandly equated with those of the middle class. They should also acquire the middle-class propensity to accumulate, as property presumably was the most meaningful stake in society that one could have. Mill favored enfranchisement provided it created a bourgeois republic.

Ricardo, on the other hand, did not believe that workers needed conversion to a middle-class mentality, for workers correctly assessed their interests, which also tended to coincide with those of the larger community (p. 176). As defined by Ricardo, the interest of the nation was to increase its net product, and this depended on accumulation (from profits, not middle-class savings). In turn, this required ending the diversion of income to land rents, luxuries, and even general government, an agenda Ricardo believed the working class would accept as being in their interest. In short, Ricardo meshed his case for voting rights to his understanding of economics. Milgate and Stimson drop the subject at this point, leaving implicit some key questions: for example, whether the enfranchised workers would really have an affinity with Ricardo’s essentially capitalist agenda. Implicitly, the authors also expose how tentative and limited was the reasoning that passed for significant reform in the classical era. The very richness of this book’s scholarship sometimes leads the authors away from their main thread. For example, the entire chapter on nineteenth-century utopias and stationary states seemed to have little relationship to political philosophy, politics or statecraft. In general the early political economists (in line with Smith) disparaged reformers as “utopian” if reform ventured in directions that would change the status quo too much. For their part, the political economists predicted the coming of a stagnant steady-state future. The relation of this to the interface of economics and politics is not clear to this reader. However, an exception occurred when colonies, and government policies toward colonies, were debated as an antidote to the steady state. Provocatively, this chapter closes with an interpretation of neoclassical economics as the victory of a sort of utopianism, in which competitive efficiency defines the best world (subject to constraints imposed by the status quo, which lie outside economics of course).

As noted, the authors compare classical economics as much to neoclassical economics (at its endpoint) as to Adam Smith at the starting point. Ironically, according to the authors, neoclassical economics reflected Utilitarian philosophy more than the actual classical economics. Neoclassical economics reduced a variety of classical questions by considering them in merely two dimensions ? individualistic utility and competitive efficiency. This, argue the authors, destroyed the interplay of economics and politics by its narrow focus on the self-oriented individual. This judgment applies as well to more recent neoclassical developments such as public choice; the putative “citizens” populating public-choice “societies” are simply homo economicus of the neoclassical world. At the conclusion of the book the authors contrast Smith’s “tenuous, equivocal, and open-ended” views on the affirmative roles of government against the “quite otherwise” views of neoclassical economics (p. 267).

In short, this book provides a striking perspective on classical political economy. The reader will benefit from some prior familiarity with Smith, Malthus, Ricardo and J. S. Mill, along with the Utilitarians. Some digression from the main thread may be forgiven as it always explores interesting concepts. The book makes only rare references to American thinkers, some of whom could have added a dimension lacking among the British authors. Alexander Hamilton, for example, clearly possessed a philosophy of politics and government informed by economic ideas and pragmatic financial experience; and his outlook clearly differed from that of the major British figures. In addition, nineteenth-century American thinkers often provided a religious interpretation to their economic and political ideas, which could have provided a welcome counterpoint to the predominantly secular outlook of the British classical economists considered.

Most of the world’s wealthy nations have been so since the nineteenth century. However, while Argentina enjoyed standards of living similar to the most developed countries during the second half of the nineteenth century, this South American country has reversed its fortune and fallen behind over the course of the twentieth century. Currently Argentina has a GDP per capita closer to other Latin American countries than the group of the developed countries to which it belonged a century ago. In his new book Roberto Cort?s Conde, a professor of Economics at the University of San Andr?s, describes in detail the evolution of Argentina’s economy in the twentieth century. The exceptionality of the Argentinean experience has been a fertile ground on which to explore relevant questions within the literature of economic growth. Why was Argentina unable to grow in the twentieth century at the same pace as countries with similar economic characteristics and endowments, such as Australia and Canada? Is the very poor Argentinean economic performance explained by exogenous shocks or domestic policies? What was the institutional framework in which the economic policies were instituted? Cort?s Conde?s narrative addresses the last two questions in particular, arguing that domestic choices and a weak government explain Argentina’s economic fall.

The book is organized chronologically in six chapters; each covering a different phase of the Argentinean economy from 1880 to 1989. Chapter 1 addresses the period during which Argentina experienced the fastest growth rates around the world in the pre-World War I era (the GDP per capita growth rate was 6.6%, twice as high as the rates of many developed countries). The export of agricultural goods drove this impressive and sustained economic performance, as Argentina is endowed with extensive and very productive portions of land. The profitability of this sector attracted foreign capital for railroads and industries. Moreover, Argentina was host to millions of European immigrants, who were tempted by the high wages. Chapter 2 discusses the economic transformation that Argentina underwent from World War I to the Great Depression. Like many other countries, Argentina entered into a recession following the commencement of hostilities as international flows of goods, capital and labor declined. Additionally, the introduction of universal male suffrage in 1912 changed the balance of power in Argentina. Cort?s Conde argues that higher democratization increased the role of the government in the economy as it intervened more actively in the determination of prices and wages. Now economic policy was put under pressure from different interest groups. Chapter 3 is a detailed description of the exchange and monetary policies in the 1930s. After abandoning the gold standard, the devaluation of the peso increased the competitiveness of Argentinean exports and protected domestic production. The strategy of growth was based on import substitution in which tariffs and quotas for final goods were raised. This period was also marked by the use of exchange margins to finance government activities and the foundation of the Central Bank.

Chapter 4 describes the main economic policies and events during Juan Per?n?s government. Argentina’s inward growth strategy not only remained during Peronism but the period was also characterized by direct public intervention through subsidies and state ownership of certain key industries. In addition, Per?n used subsidies, price controls, and monetary, exchange and trade policies to increase capital formation and real wages and to ensure full employment. The economic policy thus set up a complex and persistent network of interests, manipulated the incentives of the agents and furthermore, inefficiently allocated the factors, hindering long term growth. Chapter 5 provides a description of the period between Peron’s two terms as President (1955-1973), during which political and social instability affected economic performance. This period was characterized by innumerable military coups, reflecting the Army?s fear of Per?n?s return and communism. Any attempt to change the economic model was blocked by interest groups (e.g. land owners, entrepreneurs, unions). As a consequence Argentina underwent a process of decapitalization, macroeconomic instability and limited productivity gains. The sixth chapter analyzes the economic and political conditions that led Argentina to experience negative growth in the period from 1974 to 1989. Despite several orthodox and non-orthodox attempts, civil and military governments failed to put the economy on track. In sum, the seventies and eighties were a continuation of the institutional, political and economic problems inherited from previous periods.

The book is an excellent resource for those who wish to learn about the Argentinean economy and its main limitations during the twentieth century and it is highly recommended for any course on the economic history of Latin America. One of Cort?s Conde?s principal contributions is his fabulous effort to compile historical data and create a narrative of the evolution of the main variables. Do not expect, however, any empirical analysis that would corroborate his main points, although the data he gathers may be an important source for future empirical work. Cort?s Conde proposes that the economic failure of the Argentinean economy is due to a variety of factors and choices accumulated across time. But the initial institutional framework in which the decision making process occurred remains unclear. For instance, the reader may wish to see a discussion of whether the quality of institutions by the end of the nineteenth century was better than the quality of institutions in the next century. Moreover, it would have been enlightening to contrast the Australian and Canadian experiences with that of Argentina. What did they do right compared to Argentina? How were the interest groups held in check during the twentieth century? Would it not be the case that, since the nineteenth century, both countries had better institutions than Argentina, which would have allowed them to overcome the international shocks of the first half of the twentieth century? Furthermore, a brief discussion of why Latin American countries with similar institutions and development strategies could grow faster would help clarify Argentina’s particular situation. Finally, the potential reader would like to know a little bit more about hypotheses, proposed by other authors, concerning Argentina’s economic failure, and how they differ from the one proposed by Cort?s Conde. Although the book aptly describes the changes in economic policies and their consequences, an analytical framework explaining the winners, the losers, and the players’ sources of bargaining power would have been very useful.

Andr? Mart?nez Fritscher recently completed his Ph.D. at Boston University and will be joining Banco de M?xico as a research economist in the fall. His work focuses on the public finances and regional development in Latin American at the turn of the twentieth century.

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This is an impossible book. Had someone told me a few years back that somebody ? anybody ? was trying to write a book so short, yet so ambitious in scope, I would have laughed and filed it under ?impossible and pretentious?– and I would have been wrong. In his latest book, Jan de Vries sets out to examine the “Industrious Revolution,” following on from his Economic History Association Presidential Address (published in the Journal of Economic History in 1994). The final result is closer to a comprehensive overview of work, consumption, and well-being in Europe and North America, from the early modern period to the present. It is written from a particular vantage point: that of the household. The book represents a tremendous accomplishment: it is staggeringly erudite, insightful, stimulating, and on all the main points, convincing.

De Vries examines how households interacted with the evolving opportunities in the labor market and the changing range of goods and services. The intellectual starting point is emphatically Beckerian: households first convert part of their available time into labor income. Money is then combined with more time in the household to produce “Z-commodities” that satisfy our wants. Enjoying these Z-goods is what leisure time is for. To take an everyday example: Labor income buys edible produce; then, the meal is cooked, using non-market time; consuming it claims more of the residual time available. Gradually, households accumulate Z-capital ? the ability to produce or appreciate Z-goods. Generating this kind of capital takes time, energy, and money ? think Sebastian and Charles in “Brideshead Revisited,” teaching themselves about wine while slowly emptying the dynasty’s cellar, or the discerning palates of EUI students and faculty after a few years under the Tuscan sun. From this point of view, the ultimate budget constraint facing us all is time, not money ? it’s literally all we have to spend.

Over the last five hundred years, total hours of work ? both in the household and outside ? have shifted dramatically. To Marx, it was in the nature of capitalism itself that the lower classes ended up working more and harder. De Vries traces the rise of industriousness, defined as a combination of long hours of market work for adult males, and wide-spread participation in the labor market by women and children, to its peak in the nineteenth century. Then, for a period of less than a century, the “male breadwinner household” took over. While men worked long and hard, women became homemakers. Children started going to school.

De Vries locates his Industrious Revolution in the long eighteenth century. In the first chapter, he summarizes the theory on how work and leisure combine to satisfy desires. The second chapter fuses observations from the history of economic thought with social history, and explains how ?luxury? became acceptable ? having long been regarded as suspect in many societies, and heavily curtailed through sumptuary laws banning conspicuous consumption. Holland led the way. The burghers of the newly independent state invented a new type of luxury. While Old Luxury had a distinctly aristocratic and somewhat decadent air to it, aimed at communicating grandeur and taste, the New Luxury emphasized usefulness in the form of domestic comfort.

The next two chapters explore the supply of labor, as well as the consumer demand into which the newly-acceptable desire for practical luxury was translated. Undoubtedly, annual working hours for fully employed males had become very long by 1850 or so ? some 3,500 or so ? scarcely imaginable for workers today who often work 1,600 to 1,900 hours in most developed countries. Women and children often worked side-by-side with the men. When did hours get so long? To say anything of substance about actual hours worked before 1800 is not for the faint-hearted; existing data is staggeringly scarce [Voth 2001]. De Vries does a good job surveying the existing literature, and making a strong case for a universal rise of hours among the middling and lower sorts in Northwestern Europe at some point during the early modern period.

Why did so many Europeans start working more regularly, perhaps harder, and definitely much longer, at some point in the early modern period? De Vries essentially argues that by 1800, there were many ?new goods? to work for. Consumption baskets for the sixteenth century show that beer and bread were consumed in staggering quantities (182 liters and 182 kg per annum according to Allen 1992). While we mostly evaluate consumption in later centuries with no more than a slightly modified consumption basket, there were many other things to spend one’s money on. De Vries details the interrelated rise of fashion and of “breakable” goods; the rise and fall of hard liquor consumption, such as the gin craze; and the growing use and availability of furniture, of cutlery, ceramics, bed linens, underwear, pokers, playing cards, etc. It is the striking difference between largely stagnant day wages on the one hand, and rising consumption as reflected in probate inventories on the other, that is one of the best bits of evidence in favor of the ?Industrious Revolution.? Thus, what I have elsewhere called the “sirens of consumption” (Voth 1998) lead households to work more, and harder.

The process did eventually go into reverse. Hours per full employee have fallen precipitously. Before that happened on a large scale, women and children exited the labor force. Having developed a taste of goods over home-made services, why did the industrious households of the seventeenth and eighteenth century give way to the male-breadwinner household of the Victorian period? De Vries? answer to some extent is health. As knowledge about what made people sick spread, cleanliness became more important. Wages rose, and much of the gain was transmuted into keeping wife and children at home ? the former making the beds, cleaning the stove, mending the socks, and the latter learning in school. Feminists and ?progressive? critics have long seen the women’s exit from the labor force (at least after marriage) as a sign of male domination ? ?patriarchy? in short. De Vries begs to differ. Far from a sign of male suppression, the male breadwinner household gave ample power to women. Men handed over their pay packets, and got a warm, clean home, well-behaved children, plus some pocket money in exchange. As De Vries argues: ?The contemporary vestiges of the breadwinner-homemaker household suffer the condescension of contemporary historians and other social scientists, who often suppose themselves to be liberated from a structure of Western society as long lasting as it was suffocating. It deserves a more serious scholarly treatment. Far from eternal, it was literally a moment in Western family history. Far from suffocating, it was, in its prime, a powerful vehicle of modernization and economic advance. It was the indispensable producer of many of the final consumption commodities that we … associate with the finest achievements of modern society.?

A reviewer of Gerald D. Feldman’s monumental history of the hyperinflation [Feldman 1997] compared the prodigious production of the author with the output of the Reichsbanks’ printing presses. (I think it was meant as a compliment, despite the obvious thought that Reichsbank paper by 1923 was almost completely worthless.) In a similar vein, I thought of calling Jan de Vries’ latest work a true Stakhanovite accomplishment, but then remembered that Alexey Grigoryevich Stakhanov’s widely-praised “production miracles” in Stalinist Russia were later found to have been staged. The sheer amount of hard work that went into every aspect of these chapters is hard to convey. Surveying the rise of consumer items through the prism of probate inventories shows the author confidently mastering the abundant historical literature in four or five languages. De Vries’ reconstruction of Europeans’ increasing consumption of ?colonial luxuries? ? sugar, tea, and coffee ? alone is going to be useful for all scholars working in the area. (While this phrase is beloved by reviewers, this one put his pen where his praise was ? and immediately re-wrote a draft of his paper called “Sweet Diversity” [Hersh and Voth 2009].)

The book will be an invaluable reference for anyone working in early modern economic history. I also expect to see it used as a textbook in advanced undergraduate classes. If there is a fly in the ointment ? and every conscientious reviewer is expected to find one ? it is the almost complete disconnect with behavioral economics. The households making decisions in De Vries? world are of the sturdy Dutch burgher type depicted on the cover; work and consuming is a sober, serious business for them. They have preferences, income, and a range of choices, and then make decisions without too many further complications. De Vries, by allowing for a bit of endogenous preference formation, is departing to some extent from the more rigid basics of household decision-making models. Yet there is no struggle here of ?present selves? with ?future selves,? no hyperbolic discounting, no perennially unfulfilled desire to start saving … tomorrow (for an overview, see Mullainathan and Thaler 2001). This is not quite how some early modern observers saw (in particular) lower class consumers. Sir Frederick Eden (1797), in his The State of the Poor, was highly critical of the dietary choices made by Southern English families. He argued that choosing the quick kick of sugar and tea over more substantial fare was welfare-reducing. From his point of view, the incomes of the poor were not the issue; it was their consumption patterns. Of course, rigorous economic analysis is on shaky ground already when we allow for changing tastes (Becker and Stigler 1977); perhaps, a more detailed analysis of consumers in their full, often self-contradictory glory would have made this a truly impossible book. The profession will be grateful for the one it got.

References:

Robert C. Allen, 2001, ?The Great Divergence in European Wages and Prices from the Middle Ages to the First World War,? Explorations in Economic History 38(4): 411-47.

Hans-Joachim Voth, 2001, Time and Work in England, 1750-1830, Oxford: Oxford University Press.

Hans-Joachim Voth is ICREA Research Professor of Economics at Universitat Pompeu Fabra, Barcelona, a Research Affiliate at CREI (Barcelona), and a Research Fellow in the International Macro Program at the CEPR, London. His latest publications include ?Betting on Hitler: The Value of Political Connections in Nazi Germany? [with Thomas Ferguson], Quarterly Journal of Economics (2008); ?Interest Rate Restrictions in a Natural Experiment: Loan Allocation and the Change in the Usury Laws in 1714? [with Peter Temin], Economic Journal (2007); and ?Why England? Demographic Factors, Structural Change and Physical Capital Accumulation during the Industrial Revolution? [with Nico Voigtlaender], Journal of Economic Growth (2006).

Reviewed for EH.NET by Scott A. Carson, Department of Economics, University of Texas ? Permian Basin.

Before the 1960s, most analysts concluded that willing and able nineteenth-century European immigrants could easily stake their claim and take advantage of a dynamic labor market in the United States. Research by Stephen Thernstrom, Dean Esslinger and Sally and Clyde Griffen called this optimistic view into question, finding that upward occupation mobility was fairly limited for first generation migrants. This revisionist view itself has come into question more recently. Joseph Ferrie, for example, presents evidence that the mid-nineteenth century U.S. was, rather, a place of considerable upward occupational mobility. Raymond Cohn weighs in on this important question in his latest contribution to the economic history of American immigration. However, where others devote considerable attention to conditions awaiting immigrants, Cohn evaluates conditions in the Old World ? Britain, Germany, and Ireland ? before mid-nineteenth-century migration, conditions during transit, and conditions after immigrant arrival. In the end, Cohn supports the optimistic view that the U.S. was, indeed, a place of opportunity for those willing and able to make the passage.

Organized into nine chapters, Mass Migration under Sail has three broad sections. Chapters two through five address immigrant origins, their pre-migration occupations, and factors motivating immigration. A second narrative that distinguishes Mass Migration from other like works is chapter six, in which Cohn considers migrant conditions during transit. The remainder of the book, chapters seven and eight, consider immigrant status after arrival, and like other research in this recent vein of the migration literature, considers how immigrants influenced nineteenth-century U.S. economic growth. Thus, readers are given a comprehensive examination of nineteenth-century Northern European immigration, a migration wave that radically transformed U.S. culture and labor markets.

Of interest to economic and immigration historians is the way in which Cohn places the immigration decision into push and pull factors and how these interacted with European economic conditions. European push factors included overpopulation and the Napoleonic Wars. Pull factors included U.S. economic growth and kin effects. However, other non-push and pull factors played an important role. Shipping costs fell; ship capacity and the number of passenger ships increased. Between 1815 and 1860, approximately 5.2 million Northern Europeans immigrated to the U.S. The increased flow of immigrants is frequently attributed to the onset of the Irish potato famine. Cohn, however, demonstrates the increase in mass migration began as early as 1815; immigration increased rapidly between the 1820s and 1830s, well before the outbreak of the potato famine. While Britain was a primary source of colonial era migration, Germany and Ireland sent comparatively more immigrants during the antebellum period. Two German and Irish geographic regions were responsible for pre-1840s migration: Southwest Germany and Northern Ireland.

Immigrants took a variety of pre-migration routes and transportation means before they embarked for the U.S. British and Irish immigrants embarked from London and Liverpool; Germans left from Le Havre, Bremen, and Hamburg. While high mortality rates were prominent on specific passages, the in-transit death rate was relatively low, around 1.56 percent of total migrants. Of the small share of immigrants who died during transit, the primary mortalities were typhus and cholera. Major ports of arrival were New Orleans, Philadelphia, Baltimore, and Boston; however, New York became the primary U.S. port of arrival. In response to diseases carried by immigrants on ships, the New York State government sent immigrants with contagious diseases to the Marine Hospital and Wards Island. In response to port runners, in-transit disease, and post-arrival health costs imposed on 1840s and 1850s U.S. populations and on local governments, government reforms on both sides of the Atlantic were enacted, which reduced many of the problems facing immigrants.

The final two chapters of Mass Migration under Sail offer additional evidence that the nineteenth-century U.S. was, indeed, a place where immigrants could stake their claims for a new life. After arrival, German and Irish immigrants settled regionally by nativity within the U.S. The Irish accounted for 68 percent of all immigrants to the Northeast; Germans accounted for 47 percent of all immigrants to the Midwest; British immigrants accounted for 19 percent of immigrants to the Northeast and 20 percent of immigrants to the Midwest. After arrival, the British, German, and Irish achieved success in U.S. labor markets, and the British and German immigrants found opportunity in skilled occupations. Irish immigrants did not fare as well as the other two groups, but still fared better than had they remained in Ireland. Moreover, all three cohorts improved their average skills in the U.S. after arrival.

The last issue Cohn addresses is possibly the most relevant to modern economics. Does immigration help or hurt native labor and will migration lead to long run economic growth? The answers, of course, vary widely, but if current migration is like the mid-nineteenth century, immigration will probably increase the long-run rate of economic growth. During the nineteenth century, immigration extended the U.S. product market and allowed labor in manufacturing and agriculture to specialize. Larger pools of unskilled labor after 1845 put downward pressure on wages. However, over time, labor markets adjusted, migrants assimilated, and the economy moved forward. In this sense, Mass Migration under Sail is a valuable contribution to economic and migration history and gives perspective on current migration issues.

Scott A. Carson?s recent publications include ?Indentured Migration in America’s Great Basin,? Journal of Interdisciplinary History (2002) and ?The Effect of Geography and Vitamin D on African-American Stature in the Nineteenth Century: Evidence from Prison Records,? Journal of Economic History (2008).

Reviewed for EH.NET by William TeBrake, Department of History, University of Maine,

Karel Davids, Professor of Economic and Social History at the Vrije Universiteit (Free University), Amsterdam, has produced a thorough and well-reasoned study of the place of technology and technological innovation in the northern Low Countries during the late-medieval and early-modern eras. In his introduction, Davids makes clear that the term “technological leadership” is used to refer not to individuals but to “socio-geographical entities,” such as “a given country, region, town or cluster of towns” that played “an initiating role in the development of new technologies in a wide variety of fields.” During the late-medieval and early-modern periods, various entities played such a role at some time or another, including Nuremberg, Venice, and parts of France, but all also lost such leadership positions as others took over. According to Davids, the northern Netherlands, the territory encompassed by the Dutch Republic, was the technological leader during much of the seventeenth and eighteenth centuries, before relinquishing that role to England by 1800, and in the process of explicating the rise and fall of Dutch technological leadership, he has called into question a number of commonplace assumptions found in the historiography of the period in question.

After a brief survey in chapter one of the circumstances and events leading to the formation of the Dutch Republic by the late sixteenth century, Davids examines what contemporaries understood about technological leadership, how and when such notions first appeared, and when they began to be associated with the northern Netherlands in chapter two. For this he uses a broad range of sources, from private correspondence, travel accounts, and reports by representatives of foreign governments, to tracts on various topics from the period. In chapter three, Davids conducts a thorough analysis of the role that technological innovation played in the economic expansion of the northern Netherlands and Dutch Republic along with a consideration of the various methodological approaches available to examine that role. He makes clear that the term, “technology,” is used to refer to the “abilities of people to control or transform nature for productive ends.” Thus he is not concerned with “household technology” nor with “skills that relate to the manipulation of money or people (such as financial techniques, military tactics or the practice of administration).” What remains ranges from “agrarian practices and seafaring skills to industrial processes and building techniques.” He dates the first signs of accelerating technological innovation in the northern Netherlands to around the middle of the fourteenth century which resulted in a position of technological leadership at least in hydraulic engineering and ship construction during the sixteenth century. During the early seventeenth century, residents of the region had also begun to earn reputations as “designers and makers of tools and machines in industry” and by the middle of the eighteenth century as expert in a whole range of other fields as well.

Davids looks at the diffusion of technological knowledge into and out of the northern Low Countries in chapters four and five respectively. For this, he supplements the material he uses in the second chapter concerning contemporary “perceptions of leadership” with documented evidence of actual technological import and export. The result is a highly nuanced picture of the rise and fall of Dutch technological leadership which Davids compares to current views concerning the timing and transmission of technical innovation during the late medieval and early modern period for Europe generally and for the northern Netherlands in particular. For the entire period between 1350 and 1800, the northern Netherlands both imported and exported technical knowledge, though the inflow of such knowledge clearly exceeded the outflow in both size and scope before 1580, with a rough balance between inflow and outflow for the century thereafter. The Dutch Republic was the preeminent exporter of new technology between 1680 and 1780; by 1800, England had begun to displace the Dutch Republic in this regard. In chapters six and seven, Davids attempts to locate the causes for the rise and decline of Dutch technological leadership and he compares his findings to current views on the issue.

Davids is informative and persuasive throughout. His documentation is extensive and the material he presents, while copious, is very well organized. One of the most interesting features of his study is the attention he pays to the truly remarkable concentration during the seventeenth and eighteenth centuries of literally hundreds of industries powered by windmills in the Zaan district, just across the IJ/harbor from Amsterdam, forcing the reader to reconsider how revolutionary the English Industrial Revolution really was. Further, there are several important areas in which he has significantly revised current understanding of the course of technology, economy, and society during the late-medieval and early-modern periods. First of all, he challenges the old assumption that immigration from the southern Netherlands, France, and Iberia during the century after 1580 was the leading cause of technological advance in the Dutch Republic. Davids’ scrutiny and evidence essentially demolishes this notion. He is able to show that the importation of technological knowledge had been occurring at a significant rate since the mid-fourteenth century, peaking before 1580, and that the century after 1580 ? the time of the much-vaunted immigration ? was precisely the period during which imports began to decline and exports to climb. Further, Davids makes clear that technological leadership in the Dutch Republic was much less tied to economic advancement than is usually assumed. Indeed, the Republic’s technological leadership began to peak only when the economy of the Dutch Republic already had begun to decline, during the late seventeenth century, and such leadership continued for another century thereafter, before giving way to England only after 1780. Finally, Davids makes a compelling case for locating the causes of technological leadership (and its decline) not only in market forces but also in institutional and cultural conditions, including the relative openness or secrecy of economic, cultural, and political life.

All in all, The Rise and Decline of Dutch Technological Leadership is an impressive piece of work. Unfortunately, it is not a perfect work. My primary criticism of it is the apparent abrogation by the publisher, Brill, of all responsibility for copy editing and proofreading. The book’s faults range from misspellings, typographical errors, and inappropriate punctuation to many sentences with awkward word order ? clauses of various types inserted between elements of compound verbs, as in the refrain from that old Broadway show, “Throw mama from the train a kiss” ? while the meaning is clear, this is not the form of expression expected in formal, written English. Also, there are inconsistent and sometimes odd spellings of place names: both “Ghent” and “Gent” and both “Tournay” and “Tournai,” with only the former in each case appearing in the index. Further, “Rijssel” is found in the text but only “Lille (Rijssel)” appears in the index. And why not use Den Bosch instead of “Bois-le-duc” (no one outside the Francophone world uses this form), and why not “IJ” and “IJssel” instead of “Y” and “Yssel”? Also, for the majority of English speakers in the world, “corn” is reserved for Indian corn or maize and “grain” is used for wheat, barley, etc. Finally, this book perpetuates the silly (British?) practice of substituting “states” for “estates,” in reference to status groups and their institutionalized form, Estates General; anyone even vaguely familiar with Dutch knows that “states” is a mistranslation. In fairness to the author, all of these matters should have been addressed by the publisher, preferably, in this case, by employing a competent, Anglophone copy editor. The fact that Brill did not do so is a disservice not only to the author but also to anyone paying $199 for this work. However, such criticisms aside, this is an important study that should be read by anyone interested in late-medieval and early-modern European history, not only technological but also economic, political, and cultural.

William TeBrake is Professor of History at the University of Maine where he teaches medieval environmental and social history. His recent publications include ?Taming the Waterwolf: Hydraulic Engineering and Water Management in the Netherlands during the Middle Ages,? Technology and Culture 43 (2002): 475-99; and Hoogheemraadschap Rijnland [Water Board Rijnland], Registers OAR 11, 12, 13: 1253-1564 (Leiden: Vereniging Jan van Hout, 2006). URL: http://www.janvanhout.nl/tebrake/oar_frame.htm

Economic history frequently suffers a tension between a purely economic approach that considers homo economicus as invariable through time and space, and a relativist approach that refuses any broad comparison because of the supposed incommensurability of human activities experienced in different settings. The influence of anthropologists, especially in the tradition of Karl Polanyi, has contributed in particular to the idea held by many historians that Ancien R?gime societies were qualitatively different from modern ones, and that their economies cannot be studied in the same terms because economic activity was embedded in social life. Furthermore, this statement is sometimes reintroduced in today?s policy debates in a more normative way, when it is argued that the markets should be submitted to social institutions and needs as was the case up to the Industrial Revolution.

Laurence Fontaine ? an economic historian at Centre national de la recherche scientifique in Paris ? helps us to clarify these questions in a particularly interesting way since, as a social historian, she insists on the importance of social relationships in the provision of credit in early modern Europe, but she also, and indistinguishably, emphasizes the role of the market as allowing the poor, and especially women, to escape the constraints and limitations that result from their social position. To that extent, her book is not only a good one for those wanting to better understand the economies ? and particularly the credit markets ? of early modern Europe, but it also provides a way out of that enduring epistemological debate.

Although I have chosen to open this review by insisting on that epistemological contribution, the book is not centered on these issues, which appear mostly in the conclusion. Most of the book actually discusses the provision of credit in the Ancien R?gime economy. It chooses to study it ?from below,? that is from the point of view of economic agents and not from that of institutions, governments or economic theorists (even if all of these appear sparsely). The focus is on the ordinary agents: the poor and lower middle class, in contrast to the most-studied bourgeoisie. Because of these choices, the book is based mostly on qualitative sources, such as diaries, letters, death inventories, small firms? accounting books, and prison records, with some attempts at quantifying the questions under study, but only at an individual or local level and for relatively short periods. A few chapters build on an insightful use of contemporary novels and theater. If unsystematic, the documentation is abundant: examples are taken from all over Europe from the fifteenth to the eighteenth centuries. The book is organized in a thematic order (with chapters on the poor, the peasantry, the elite, urban micro-credit, women, pawnshops, usury, mentalities, exchange practices and the construction of trust). This organization brings a strong sense of the fact that most economies inearly modern Europe faced similar problems, even if the variety of traditions or the different choices that were taken by governments when creating or regulating institutions are frequently mentioned. It downplays long-term change, even if some particular transformations are mentioned.

As is typical of any book dealing with such a large period and space, it is mostly based on a large ? indeed impressive ? bibliographical base (30 pages of references, mostly in English, French and Italian, with occasional Dutch, German and Spanish). It is, perhaps more importantly, based on Fontaine?s experience studying the poor and migrants (especially peddlers) of early modern Dauphin? and Savoie.

The first important result of the book is to show that credit was not only developed among the well-to-do in early modern Europe (as shown for example by Hoffman, Postel-Vinay and Rosenthal in Priceless Markets). It was a daily part of the ?survival strategy? of the poor, more important, indeed, than the help provided by charitable institutions. Most of the working poor needed credit in order to start or to keep their small businesses running in the face of accidents, delays, illness, and life-cycle events ? and this was true as much in the countryside as in the cities. Fontaine shows that the few remaining traces suggest that oral credit was ubiquitous, that written credit was much more frequent than what is observed in notaries? archives (because of the cost and delay of their certification), and that a majority in the population died with negative assets ? that is, unpaid debts superior to their belongings.

Credit was organized in various circles, starting from the closest relatives (the family and neighbors), social authorities (the lord, notables), institutions (guilds, pawnshops) and, lastly, foreigners ? as most moneylenders were considered (either Lombard, Savoyard or Jew). Except for very small amounts, credit among equals (or relatives) ? was rarely much of a resource for the truly poor … because their relatives were poor too, and also because even ?family solidarity is everything but natural? (p. 36). Actually, such solidarity could only result from a well-organized community, which was able to constrain the borrower. Therefore most of the credit to the poor came from notables, institutions and moneylenders.

Among these, the lords were probably those with the most specific behavior in the Ancien r?gime. They frequently lent substantial amounts to their vassals, especially to their farmers. These debts were seldom reimbursed, and mostly implied yearly payments (which could be in kind). They could be restructured when either the lender or the borrower left or died, and parts of them could even be abandoned gracefully in periods of hardship. Fontaine argues that these debts were part of a broader social relationship, which explain both that the lords had to lend in order to maintain status and reputation even when reimbursement was anticipated as almost impossible, and how they were able to force payments for long periods, thanks to their local power.

Aristocrats actually reciprocated downward the relationships based on political dependence they suffered towards the princes to whom they forcefully lent and asked for privileges or rents as payments. When in debt (and they were frequently so), they dismissed and ill-treated their moneylenders (who always suffered bad treatment if they tried to obtain payment through legal means), except those who had been able to access some personal secrets, as was frequently the case when wives pawned their jewelry to old women lenders (the marchandes ? la toilette made famous by novelists down to Balzac). On the other hand, aristocrats considered their gambling debts as the only serious ones because they were purely personal, among equals, and a symbol of their lives? dedication to risk and gratuitousness.

At the opposite end of the social spectrum, poor women had no power and a precarious status. Fontaine shows that the legal position of women mostly deteriorated in much of Europe in the early modern period, obliging them to participate in the most informal and unsecured credit markets. However, her conclusion is not that the market was dangerous to women, but quite the opposite, since where women started participating in markets, they ended up not only surviving, but even obtaining some recognition, as merchants if not as wives: ?Everywhere and since the Middle Ages, the development of markets boosted the legal autonomy of women? (p.144).

Credit was then not limited to the world of the merchants, as often described, but penetrated, although unevenly, all classes of society. As early as the first half of the sixteenth century, Rabelais could write that ?nature created man only to lend and borrow.? Usury laws were unable to restrict the ubiquity of credit, as the Church actually abandoned applying them as early as the sixteenth century. At that time, the states took over the issue and maintained or reinforced usury laws, but let develop a jurisprudence which allowed for many exceptions and by-paths.

Credit was ubiquitous and diverse, but Fontaine argues that its diversity can be better understood using a bipolar lens. Step by step, her book builds a representation of the credit market that distinguishes two ideal-types of credit relationships. These two ideal-types are clearly delineated in chapter 8 thanks to the use of Shakespeare (Timon of Athens and The Merchant of Venice), Moli?re and the Tableau de Paris by Louis-S?bastien Mercier. The first one is ?aristocratic? the second one ?merchant.?

In the aristocratic world, credit relationships are embedded in social relationships and religious imperatives: interest is frequently hidden or in kind, or even disguised in voluntary gifts, debts have no definite term or can be prolonged indefinitely, the relationship between debtor and creditor is statutory or personal. In the merchant world on the other hand, the contract is precisely defined and respected thanks to strong guarantees, and the relationship is impersonal or among equals thanks to a strong role of the law. If this distinction is similar to the one usual among anthropologists, Fontaine?s claim is actually very different: first because she argues both types of relationships co-existed permanently (even if their relative importance varied) and most people could enter both types of relationships, choosing with whom to contract. Second because the market was not intrinsically less humane than the personal relationship: if less open to credit restructuring for personal reasons, it was more rule-based and thus more protected against the creditor?s power. So individuals chose both what type of relationship they wanted to enter and with whom to enter it. They, usually, had some choice, and the social environment, although constraining, was also a space of opportunities.

Even more important, Fontaine shows that the aristocratic and the merchant economies not only conflicted but also penetrated each other. Chapter 6 is very illuminating in that respect, showing that pawnshops (monte di pieta) were invented in the early fifteenth century by Franciscans wanting credit to become a complement to charity, one through which the poor could get more autonomy and capacity to exert their talents, although escaping the dangers of usury and over-indebtedness.

The last chapter on the social construction of credit provides the reverse example: while Franciscans accepted the role of credit markets in helping the poor, merchants never entirely rejected some ?aristocratic? dimension of credit. Analyzing bankruptcies and the relationships among merchants in hard times, Fontaine shows that they appealed to the community to which they belonged, and obtained help as long as they were truly integrated into it, much like in the aristocratic economy.

The book then concludes that both market and personal relationships were always present in early-modern credit, but focuses mostly on the role of the market in allowing the emancipation of the poor and the development of their capabilities, in an explicit reference to Amartya Sen. Although I had great pleasure in reading this convincing and powerful book, a few critical remarks must be added. First, although the book?s approach encompasses many topics, some important ones are missing. The practices and culture of credit among merchants is given little place. This is certainly intended as a necessary correction in view of its excessive place in the previous literature, but the correction is probably also excessive. Public credit is also absent, to some extent in contradiction with the author?s very views on the relationships between princes and some of their aristocratic creditors. Maybe most importantly, this is a history with little historical change. As mentioned earlier, some changes are mentioned in various chapters, but no answer is given to the most important question: if there was a substantial change in the way credit markets worked from the sixteenth to the nineteenth centuries, what was that change and where did it come from? The author could have linked the emancipation towards the power element in aristocratic relationships with the development of legal and representative institutions; nevertheless, law is little present except in the chapter on women, and politics is altogether absent. Finally, contemporary economic thought and modern theory are absent. Both have nevertheless proved to be useful in order to understand early modern economies (see e.g. Grenier?s L??conomie d?Ancien R?gime as an attempt based on contemporaries). Fontaine actually uses some concepts from imperfect information theory, but quite clumsily. These remarks suggest that an even broader synthesis would be welcome in order to provide a truly comprehensive view of early modern credit.

Some of the book?s arguments are not well presented, and would have gained from better writing. The author frequently makes the point that personal debts were extended for long periods, but does not relate this clearly to the annuities model which was so dominant in farming and public debt in the period. Over-indebtedness is forcefully asserted, but insufficiently demonstrated in economic terms, since payment flows should be related to incomes rather than volumes of debts to assets. More seriously, the author argues that the fact that the poor invested all their income in clothes or jewelry reflected a ?preference for illiquidity? (e.g., p. 132), when actually these goods were chosen because they were highly liquid (thanks to the pawnshops the author describes so well), and were given preference over money because of the riskiness of money that could be stolen or be forcefully borrowed by relatives.

Other remarks are more formal. Although the book is quite beautiful, it is not well edited. Chapter two is somewhat repetitive of chapter one, some developments (e.g. on women?s legal status on pp. 134-56) are too long and are not well integrated into the general story. A more careful reading by the publisher would also have avoided the repetition of entire sentences (pp. 164 and 165, pp. 185, 186 and 189, pp. 244 and 265) or quotes badly cut (p. 172).

In spite of these small shortcomings, this book remains an impressive synthesis and a brilliant essay. One should hope that it will be rapidly translated into English in order to get the wider readership it deserves.

Pierre-Cyrille Hautcoeur is Professor of economics at Ecole des Hautes Etudes en Sciences Sociales and Paris School of Economics, Paris. His recent publications include Le march? financier fran?ais au 19e si?cle, Paris, Publications de la Sorbonne, 2007, the edition of a special issue of Histoire et Mesure on bankruptcies, “Bankruptcy Law and Practice in 19th Century France,” in Insolvency and Bankruptcy Laws: Issues and Perspectives (JAI University Press, 2008) and “Why Didn’t France Follow the British Stabilization after World War One?” (with M. Bordo), _European Review of Economic History, 2007.

Reviewed for EH.NET by Timothy E. Gregory, Department of History, Ohio State University.

As the authors point out, until recently the economy of the Byzantine Empire has not been the subject of many detailed studies. The reasons for this are many, including the continued bias against Byzantium even in historical circles and the perception that the economy of the empire was dominated by the heavy hand of an autocratic state and that its study has little to teach us. This small and quite readable book is likely to change all such scholarly assumptions. It is based squarely on the massive and detailed three-volume The Economic History of Byzantium from the Seventh through the Fifteenth Century, edited by Laiou and published in 2002, and its articles, many of which present completely new analyses of crucial facets of the Byzantine economy and revise many conclusions found in standard textbooks. The present book, of course, is much smaller in scale, but it makes up for that by a more concise focus and a treatment that is accessible to readers, from beginning students to scholars interested in the economy of the medieval West or the Islamic East.

The Byzantine Economy differs from most extant studies of Byzantium by insisting that modern economic theories and studies are relevant for Byzantium and by frequently making seamless use of archaeological and archival sources, as well as the more commonly utilized literary and numismatic material. The literary sources, they reasonably insist, are highly biased by the focus of their authors on the central government, a bias that had led most scholars to the conclusion that the state was the dominant element in the Byzantine economy, which emperors and administrators affected without any real economic interest or knowledge. Laiou and Morrisson do not, of course, deny the importance of government action, especially the successive fiscal institutions and policies over the thousand-year history of the empire. Rather, they argue throughout that, on the one hand, Byzantine statesmen frequently made decisions based on economic considerations, and, on the other, that political and non-economic factors (frequently from outside the empire itself) not uncommonly played crucial roles in the development of the Byzantine economy.

The book is arranged chronologically and it begins with a helpful consideration of the ?natural and human? resources available to the empire. Treatment of late antiquity (sixth-early eighth centuries) avoids what would otherwise be a necessarily long discussion of the situation in the third-fifth centuries, and analysis essentially begins in the period of Justinian. There is little new here and it is clear that the authors regard the period as a continuation of the ancient economy that forms merely an introduction to the economy of the seventh century and beyond. The Byzantine economy per se came into existence as a result of devastating depopulation in the aftermath of the plague of 542 and significant climate change. The labor shortage led to political and economic fragmentation, and a complete reorganization of the economic underpinning of the state. The loss of areas that had provided much of the raw materials of the empire caused severe contraction of manufacturing and a diminution of the money supply. Nonetheless, the meager sources suggest that, even in this period, trade continued and the economy was much more fully developed than has previously been thought. The latter part of the eighth century witnessed significant changes in the military power of the state and the beginning of a slow growth of the Byzantine economy and its gradual monetarization as well as the revival of urban life. Constantinople was the main economic center, and it was an industrial and trading power whose merchants engaged in long distance trade throughout the Mediterranean, Europe, and the Near East. Key in this revival was the state, its fiscal policies, and a complex economic ideology based on ideas of justice in interchange and possession of property.

By the eleventh century Byzantium reached its economic height and by the twelfth century Byzantine cities had developed some of the characteristics that could be seen in the contemporary West. At the same time, and for some of the same reasons, the Byzantine aristocracy had come to challenge the exclusive right to political and economic power that had been maintained by the state (i.e., by the emperor and the imperial bureaucracy). The authors discuss this struggle, that has long interested historians, but in the end they conclude that the victory of the aristocracy did not inevitably cause economic problems for the state or for the peasants. In addition, western (mainly Italian) merchants came to control greater and greater portions of long-distance trade, in part because of tax concessions given them by the Byzantine state and because of their increasing access to naval power. Throughout the twelfth century the Byzantine economy flourished and medium- and large-scale production (both agricultural and industrial) served local, regional, and ?international? markets. The cities, as well as the countryside and marginal lands, played important roles in this economy, contradicting the old theory that middle Byzantine cities were ?parasitic? in nature. The authors conclude that Byzantine merchants played a decreasing role in this trade. In the view of the authors, however, this was not an irreversible situation, but one that was affected negatively by the growth of western military power in the form of the Crusades and, ultimately, the conquest of Constantinople in 1204.

After that date and even after the recovery of Constantinople in 1261 the economy remained fragmented and the loss of areas with important resources, such as mines in Asia Minor and the Balkans, had important negative results. Nonetheless, the authors maintain that the Byzantine economy remained ?articulated? and population growth continued until the middle of the fourteenth century, when the combination of the Black Plague and the loss of most remaining territory to the Ottomans essentially put an end to anything resembling a unified Byzantine economy.

In a concluding chapter the authors make general observations about the Byzantine economy and discuss the value of comparing it specifically with the economy of the medieval West. They conclude that contemporary research shows the Byzantine economy, in virtually all periods, to have been sophisticated and flexible, able to respond to challenges and to change in the face of historical conditions. In most periods the state, in the person of the emperor and a large and well-trained bureaucracy, was the most important factor in the economy, but it was by no means the only one, and political, ideological, and fiscal considerations, as well as forces outside the empire, played significant roles. They note that recent research, in both East and West, has pointed to the importance of the linkage between production and distribution and has seen greater similarities than differences in the two economies. Finally, they strongly suggest that it is not reasonable to ?blame? Byzantium because it did not develop western-style capitalism, something that did not come about in the West until the eighteenth century. They conclude that Byzantium had a ?flexible and dynamic economy, which was successful in terms of growth but also provided some important needs of the people … that is, all the factors which today are recognized as constituting true economic development? (p. 247)

This book is a convenient, reasonably well written and carefully documented handbook that should be on the shelves of anyone interested in Byzantium or the medieval economy.

Timothy Gregory is Professor of History and Anthropology and Director of the Ohio State University Excavations at Isthmia; he is author of books such as Isthmia, Volume V, The Hexamilion and the Fortress (Princeton 1993) and A History of Byzantium (Oxford 2006). He has pioneered in the teaching of online courses in Classical Archaeology and Byzantine History. gregory.4@osu.edu.

Reviewed for EH.NET by Niv Horesh, Faculty of Arts and Social Sciences, University of New South Wales.

The Great Depression and its underlying causes and multiple effects have long engaged economists, economic historians and theorists. Studies of the financial turbulence preceding World War II include classics by Friedman and Schwartz (1965), Kindleberger (1973) and Eichengreen (1992).[1] These have been recently supplemented by books aiming to link events in the U.S. with the rest of the world. Some of these new books have been reviewed on EH.NET, but none to date has centered exclusively on China.[2]

Tomoko Shiroyama?s monograph is, therefore, a much-awaited and highly valuable contribution to the literature. Its narrative is comprehensive, globally-framed and thick with quantitative data. For these reasons, it would no doubt appeal to economists and China specialists alike.

In her introduction, Shiroyama clearly sets the tone for the chapters to come. While the Great Depression was ?a watershed in the making of modern China,? its implications are often downplayed by students of China?s pre-war economy. The latter believe, for the most part, that China was shielded from deflationary pressures due to its adherence to the silver standard. Chapter 1 explains the intricacies of the silver standard, which China did not abandon until late 1935, whereas other Asian countries had switched to gold-based currencies by the 1910s. Shiroyama then argues persuasively that the depreciation of world silver prices during the 1920s greatly improved China?s terms of trade and was a boon to its farmers and emergent industrialists. However, the price of silver began to appreciate on world commodity markets as of 1931, and spiked up sharply in the lead-up to Roosevelt?s Silver Purchase Act in 1934. By then, dearer silver and slumping demand in the West had hit Chinese exports and dampened the price of domestic produce.

Chapters 2 and 3 depart from the subject matter to discuss the rise of Chinese-owned cotton-spinning mills and mechanized silk filatures in the Lower Yangzi Delta between 1895 and 1930. This portion of the book might have benefited from clearer linkages with subsequent chapters and from tighter writing. Uninitiated readers will find in these two chapters a fairly informative overview of Chinese corporate structures and capital mobilization in the early twentieth century. But they might wonder, for example, precisely what distinguishes a Chinese ?native bank? from a Chinese ?modern bank? or whether China really ?had no financial institutions such as stock markets? until 1920 (p. 63). In fact, Chinese company stocks were traded in Shanghai as early as the 1880s. Similarly, when discussing loans made by HSBC to ?native banks? (read: money shops or qianzhuang) in Shanghai between 1923 and 1929, Shiroyama states that these amounted to ?52.6 percent of the total amount lent? (p. 77). But it is not clear whether the total in point refers to HSBC?s entire loan portfolio, loans to Chinese banks broadly defined, or just loans to money shops.

Chapters 4 through 6 present very compelling evidence. Here, Shiroyama explains in detail how the slump in global trade volumes gradually depressed Chinese primary product prices. At first, the Depression was offset in China by ascending gold prices which made Chinese exports more competitive. After 1932, however, rural welfare was seriously hampered because cash crops like raw cotton or silkworm cocoons were fetching less than rural households needed in order to purchase food supplements such as rice, salt and oil (pp. 98-99). The diminishing purchasing power of farmers eventually meant a shrinking domestic market for industrial goods and a pernicious flight of silver capital from the hinterland to Shanghai, fuelling a real estate bubble there (pp. 146-148). Then the American Silver Purchase Act of June 1934 dealt a severe blow to the Chinese economy, because it made China?s silver-based currency appreciate again, and rendered Chinese exports still less attractive (pp. 153-161).

Chapters 7 and 8 recount how China?s Nationalist government steered China away from the silver standard to combat the Depression in the face of Japanese aggression. Painstakingly drawing on U.S. and British archival sources, Shiroyama emphasizes the critical role played by the Roosevelt administration in facilitating the KMT?s move off silver and in China?s transition to fiat currency. The British envoy to the region, Frederick Leith-Ross, is often credited with devising China?s currency reform in 1935, but Shiroyama observes that Britain?s role in the reform has been greatly exaggerated (p. 180).

While presenting a useful overview of previous chapters as well as a sketch of monetary policy in China to 2005, the conclusions do not readily cohere into strong statements. Earlier reference to the debate between Thomas Rawski and Milton Friedman about the severity of the Great Depression in China might have helped sharpen the analysis toward the end but, surprisingly, Friedman?s body of work does not seem to have been consulted, and is not cited in the bibliography. Still, Shiroyama?s book is sufficiently packed with other detail and incisive observations to enthrall anyone interested in the Great Depression and Chinese economic performance under KMT rule.

References:

1. Milton Friedman and Anna J. Schwartz, The Great Contraction, 1929-1933, Princeton University Press, 1965; Charles P. Kindleberger. The World in Depression, 1929-1939, University of California Press, 1973; and Barry Eichengreen, Golden Fetters: The Gold Standard and the Great Depression, 1919-1939, Oxford University Press, 1992.

2. See, for example, Patricia Clavin, The Great Depression in Europe, 1929-1939, St. Martin’s Press, 2000; Thomas E. Hall and J. David Ferguson, The Great Depression: An International Disaster of Perverse Economic Policies, University of Michigan Press. 1998; Mark Wheeler, editor, The Economics of the Great Depression, W.E. Upjohn Institute, 1998; Elmus Wicker, The Banking Panics of the Great Depression, Cambridge University Press, 1996; Randal Parker, Reflections on the Great Depression, Edward Elgar, 2002; and W.R. Garside editor, Capitalism in Crisis: International Responses to the Great Depression, St. Martin’s Press, 1993.

Niv Horesh, who is a Lecturer in Chinese Studies at UNSW, has recently finished The Bund and Beyond (forthcoming, Yale University Press), a study of British banking in pre-war Shanghai.

Ronald Findlay and Kevin H. O?Rourke, Power and Plenty: Trade, War and the World Economy in the Second Millennium. Princeton: Princeton University Press, 2008. xxvi + 619 pp. $39.50 (cloth), ISBN: 978-0-691-11854-3.

Reviewed for EH.NET by ?evket Pamuk, London School of Economics and Bogazi?i-Bosphorus University.

Ronald Findlay of Columbia University and Kevin H. O?Rourke of Trinity College, Dublin have written a magisterial account of the history of international trade during the last millennium. They provide a theoretically coherent account of the interaction between the patterns and evolution of inter-regional trade, on the one hand, and long-term global economic and political developments, on the other. The two way interaction between power and plenty as formulated by Jacob Viner but going back much earlier in its origins, constitutes the analytical backbone of the volume. Findlay and O?Rourke argue convincingly that no history of international trade can ignore conflict, use of force, military exploits, and in turn, geopolitics. They draw upon a large volume of secondary historical and political literature as well as economic theory and succeed in integrating a vast amount of detail as well as their own research into their conceptual framework.

A large part of the exposition and analysis of the major developments in international trade proceeds in terms of the interaction between the seven regions of Eurasia as defined by the authors and the contributions arising from these interactions, in terms of the movements of people, crops, ideas, and techniques as well as commodities. A good deal of emphasis is placed on the importance of geography in explaining the interactions between the seven regions with very different physical features and endowments. This skillfully written volume is a work of extraordinary scope, a major achievement.

For the first half of the millennium, the authors should be commended for focusing on two key events, the Pax Mongolica and the Black Death, both of which involved most, if not all, of the seven regions. The unification of the central Eurasian landmass by the Mongols in the thirteenth and early fourteenth centuries facilitated the interaction of Western Europe and different regions of Asia from the Atlantic to the Pacific Ocean. Mongols encouraged trade and made the routes across Eurasia safer and busier. Arguably, this was the first episode of globalization in history. Moreover, it was the disintegration of the Pax Mongolica and the shift of the trade to the southern routes across the Indian Ocean and the Middle East that led to the search for alternative ways of reaching Asia by western Europeans. As the authors point out, the ultimate legacy of the Pax Mongolica was not, perhaps, the increase in the interaction between Europe and Asia but the mutual discovery of Europeans and native Americans.

The Black Death, which originated in Mongol-controlled Asia but ended up in the Middle East and Europe, brought about far-reaching consequences for these regions. The sharp decline in the population led to an even sharper rise in wages. This high-wage environment, which lasted for at least two centuries, brought about very different demographic, economic, social and other responses not only between Europe and Asia but also within Europe, between the northwest and the south. As the authors make clear, the long-term consequences of the Black Death have not been fully analyzed and deserve more attention from economic historians.

For the second half of the millennium the focus of the volume is on the rise of an international economy and its contribution to the Industrial Revolution. The authors see the Industrial Revolution as the culmination of a long historical process involving the interaction of all the world?s regions through trade and transfer of technology. Findlay and O?Rourke emphasize that any account of the ?Rise of the West? that focuses purely on domestic developments ? such as western institutions, cultural attributes or endowments and ignores the vast web of interrelationships between Western Europe and the rest of the world ? is hopelessly inadequate. They argue that the Industrial Revolution needs to be understood as the outcome of a historical process with multiple causes going back to the medieval era in which international movements of commodities, warriors, microbes and technologies all played important roles. They also make clear that the Industrial Revolution not only transformed the international trading system but also gave rise to huge disparities around the globe as the spread of industrialization has been very uneven in the two centuries since.

Plunder or primitive accumulation may not have fueled the Industrial Revolution directly, but the authors emphasize that by expanding markets and ensuring the supply of raw materials, mercantilism and imperialism were an important part of the story. Violence did matter and often shaped the environment in which this exceptional event took place. The authors acknowledge that Asians and those from other regions of the world were not passive actors. They also ask two key questions with regard to the Industrial Revolution: why Britain and why Europe? The answers to both include not only the domestic factors but also control of long distance trade, overseas markets and raw materials. They emphasize in many parts of the text the key role played by the British navy in a world in which nations systematically excluded their enemies from protected markets.

The remaining chapters of the book are devoted to the analysis of the unprecedented expansion of international trade during the last two centuries, based on the ?Great Specialization? (manufactures vs. agriculture) that emerged in the aftermath of the Industrial Revolution and remained in place until recently. The ratio of world trade to GDP is sharply higher today than it was two centuries ago, but this rise has not been continuous. The powerful trend for globalization during the nineteenth century was followed by the collapse of world trade or deglobalization after 1914 and a more or less steady expansion of trade once more or reglobalization since the end of World War II.

One theme that is conspicuously absent in this volume is institutions ? which have occupied center stage not only in the economic history literature but also in economic theory in recent years ? and their impact on trade and economic development. While the authors emphasize the importance of international trade for the ?Rise of the West,? they could have focused more explicitly on the linkages between international trade and institutional change. One can think of at least two major channels through which long distance trade facilitated institutional change in Europe. During the period before 1000 and even until 1500, trade with other regions allowed Europe to learn about and then adapt some commercial, monetary and financial institutions. The transmission of the Islamic institution of business partnership or the mudaraba to the north of the Mediterranean in the form of the commenda is an important example of such borrowing and adaptation. These exchanges were very important for the development of western European institutions and the authors mention some of them. In the early modern era (that is after 1500) trade with other regions of the world led to institutional change in Europe through another mechanism. By giving greater power to merchants, long distance trade enabled them to shape the institutions in early modern Europe more forcefully in the direction of capitalism, as Acemoglu, Johnson and Robinson have recently emphasized. Arguably, greater political as well as economic power for merchants is an important characteristic that sets Europe apart from the other regions. It also provides another dimension to Viner?s power and plenty couple which is at the analytical center, as well as the title, of this book.

This is a well researched volume which is simply delightful to read. In most of the topics about which I have some knowledge, I found the analyses and the judgments offered by the authors both balanced and insightful. I expect this book will remain the standard text for many years to come.

?evket Pamuk teaches economic history and political economy at the London School of Economics and Political Science and Bogazi?i-Bosphorus University, Istanbul. His recent publications include A Monetary History of the Ottoman Empire (Cambridge University Press, 2000) and ?The Black Death and the Origins of the Great Divergence inside Europe, 1300-1600,? European Review of Economic History, 2007. s.pamuk@lse.ac.uk

Reviewed for EH.NET by George Grantham, Department of Economics, McGill University.

Most economic historians who do not specialize in the medieval period draw their understanding of its economic and social evolution directly or indirectly from the work of historians inspired by Henri Pirenne and Marc Bloch, both of whom viewed it as a decisive turning point in Western history. As set out by Georges Duby in his essay on the early growth of the European economy, the half millennium following the formal end of the Roman Empire in the West marks the crucial discontinuity in Western Europe’s economic and social history.[1] The notion was, of course, not new. Originating in the humanist philological critique of early medieval Latin, the notion of a decisive break in social, political, and economic institutions was extended to other domains in the debate between Abb? Du Bos and Montesquieu over whether the Franks were subject to royal taxation, and by early nineteenth-century efforts to construct historical typologies from the surviving diplomatic and legal texts as part of the project to place the French Revolution in historical perspective. That effort led to a consensus that the West experienced a major economic and institutional collapse in the sixth and seventh centuries, and that from the wreckage there emerged a more decentralized economic and political system based on the exploitation of the rural population by lords connected politically in hierarchies constructed from bilateral ties of mutual obligation and fidelity. That institutional space left little room for agricultural innovation and hardly any for economic organization founded on the legal egalitarianism of voluntary exchange. The historiography thus posed three questions: the first concerned the process by which the old world was transformed into a new one; the second concerned the nature of that new world as an economic and social type; the third was how it in turn gave birth to modern western capitalism. Since the dissolution of Roman civilization was an uncontested fact, most attention was devoted to the second and third questions. It is only in the past thirty years that the first has received the attention it deserves, with devastating consequences for the conventional wisdom.

The present works by the eminent Belgian historian Jean-Pierre Devroey represent a vigorous defense of the conventional view that the early medieval society and economy was a distinct social type fundamentally different from the societies that preceded and succeeded it. Explicitly inspired by the theories of Max Weber and Karl Polanyi, this vision is idealistic rather than causal or mechanistic, to use an old-fashioned dichotomy. It aims to explain “why” things worked in terms of their relation to a pre-existing whole rather than “how” they worked in terms of ordinary connections between cause and effect. For Devroey, the true history is sociology. The historian’s task is to show how relations between different elements of a society formed a coherent “whole” or type. The theoretical foundation of this approach to the past is Durkheim’s tenet that social cohesion is a necessary condition for the temporal persistence of a society. This makes the central task of the historian the identification of the sources and mechanisms of that cohesion. Since every society is unique, the mechanisms will differ, providing a basis for comparative analysis of societies. The project of these two works, then, is to construct an ideal type for that analysis. As Teggart pointed out long ago, this approach to history is essentially teleological, since it presumes the whole used to explain the meaning of the parts.[2] In the present case the “whole” is Frankish society. The books thus fall in the category of “stages” history, to which may be added work on the same period by the English historian Chris Wickham, whose approach is also inspired by Polanyi notions of reciprocity and redistribution as essential means of securing social solidarity in primitive societies.[3] Both authors read the early medieval record through the eyes of social anthropologists, and are thus blind to what the eyes of Machiavelli and Adam Smith detect in it.

Devroey’s work thus poses a direct challenge to the alternative vision of early medieval society proposed by Karl-Ferdinand Werner, Jean Durliat and Elisabeth Magnou-Nortier, who view the early Middle Ages from the perspective of the two great theorists of self-interested human behavior. That perspective reveals significant continuity with late Roman civilization in Frankish institutions of public administration and landholding.[4] The findings rest on a re-reading of the polemical and chronological texts, on prosographical studies of the leading Frankish families in the degree the evidence supports it, and on close analysis of the contemporary legal texts. It starts from the premise that the dissolution of the Roman state in the West was essentially an appropriation of its levers of power by German military leaders to whom the Roman state had unwisely subcontracted the defense of the Empire. Given that premise, the central historical questions turn on how the change in administration affected existing governmental apparatus and the day-to-day life of ordinary people, and how political legitimacy ? the ability to command and the willingness to obey ? was maintained in the presence of new and foreign rulers. Of the day-to-day life we know virtually nothing; but it seems plausible that in the core of the Frankish kingdom, things went on pretty much as before, except that, as would be the case down to the middle of the seventeenth century, there was fighting among elites for control of the state and its fiscal resources, and that for this and other reasons that part of the economy based on exchange imploded. On the sources of political legitimacy and the apparatus of administration, the texts are more loquacious, and everything thing they say supports the notion of continuity rather than the creation of a new society by force.[5] If so, the early medieval past was not a different country, but a place and time where men (and women) behaved in ways that are familiar to us. It did not constitute a “whole” whose meaning is accessible only through an exposition of its inner logic, but a congeries of institutions, practices, and attitudes evolving at different rates under the pressure of particular events.

From the perspective of economic history the main issues concern the nature of landholding and the organization of the state. Was land effectively “owned” by the elite and farmed by tenants on tenures determined by asymmetric bargaining, or was it mostly in the hands of small holders subject to their paying a property tax? To some that may be a distinction without a difference: taxes mainly went to support soldiers who the conventional historiography holds were granted land and rights of peasants in payment for their services. In either case the agricultural surplus went to the same people. But from the perspective of agrarian history the distinction is crucial. Taxes were based on assessments not easily altered, since they were regulated by law. On the assumption that they continued to be collected by tax farmers, the proceeds, or more commonly the tax base that generated them, could be securitized and alienated like any other asset, which would explain the exceptionally complex pattern of claims revealed by the sources. The issue turns on the continuity of law. The “primitivist” view of early medieval society espoused by Devroey considers the early medieval era to be fundamentally lawless and governed by relations of force in which the strong expropriated the weak. The “Romanist” view holds for legal continuity; the strong appropriated the tax base but within what must have been fairly wide bounds maintained the rule of law with respect to collection. The issue bears directly on the interpretation of terms relating to agricultural organization, which can be read alternatively as describing estates and farms or as units of fiscal assessment. According to Devroey, the “fiscalist” view is in his words “formalist,” because it rests on the explicit meaning of the legal texts rather than their presumed “real” meaning. He denies that view at great length and in great detail. The denial represents the core of both volumes.

Neither book is an easy read. ?conomie rurale is intended as a textbook for students preparing the aggr?gation, or state doctoral examinations in medieval history. Puissants et mis?rables is a treatise constructed on Weberian principles modified by late twentieth-century French sociology. Both deploy immense erudition to support the conventional view of a discontinuity and social primitivism against the hypothesis of continuity. Since the technical debate turns on etymological issues bearing on individual terms, it would be fruitless to attempt to summarize the argument in a short review. I am not persuaded by it, but as I am not a specialist in late Roman and early medieval Latin my judgment carries no special weight in the debate. Nevertheless, many of his arguments strike me as dogmatic assertions and special pleading. Heavy reliance on Polanyi as a source of theoretical insight raises further danger flags, as do abstract sociological arguments used to motivate description and analysis of institutions. One longs for a simple explanation of how things worked rather than why they worked. In terms of the issues raised, both books would have been better served by a clear exposition of the alternative points of view followed by analysis of facts bearing on them. They contain a lot of useful matter, but it is hard work to release them from their matrix of verbiage. The bibliography is magnificent. To cite the review of Moritz-Maria von Igelfeld’s Portuguese Irregular Verbs, the books give the impression that “there is nothing more to be said on this subject. Nothing.”[6] There is, of course, much more to be said.

Of the two works, the textbook is more accessible to non-specialists, despite being disfigured by “boxes” containing further information of the kind familiar to users of elementary textbooks in economics. The other covers more ground and provides a splendid introduction to the huge explosion in scholarship since the 1960s. Neither book can be ignored. Though clearly not the last word in early medieval economic and social history, they represent a major contribution that no one pretending to an opinion on the period can afford to dismiss. They are, however, highly opinionated, and must be read in conjunction with the literature they criticize. This is hard work, but there are no short-cuts to mastering the secondary literature on early medieval economic history. The divisions among its main practitioners are important and deep. The best account in English is a recent survey by Goldsmith, who gives a clear exposition of the “fiscalist” hypothesis, and follows up its implications for the subsequent evolution of land tenure in France to the end of the Middle Ages.[7] This is the best place for beginners to start.

The early middle ages are a fascinating and central segment of the history of western civilization. Like all extended periods, they were a time of transition. The explosion of scholarship since the 1960s and the renewal of interest in classical antiquity have given new life to a subject whose general contours seemed to have been set in stone in the magnificent syntheses proposed by Pirenne and Bloch. It is time for a new synthesis that encompasses the new findings and interpretations in a plausible narrative account of the transformation of a society and economy over five centuries. That synthesis is within reach, but to attain it will require confronting these two large volumes that, like the Roman army in its latter days, defend the conventional wisdom on the several fronts of attack.

References:

1. Georges Duby, The Early Growth of the European Economy: Warriors and Peasants from the Seventh to the Twelfth Century, London (1974).

7. James Lowth Goldsmith, Lordship in France, 500-1500, New York (2003).

George Grantham is Professor of Economics at McGill University, where he teaches economic history and the history of economic thought. His work on the present topic includes “The Early Medieval Transition: On the Origins of the Manor and the Early Medieval Transition,” presented at the Annual Meetings of the American Economic Association, Nashville, 2003. He is currently revising papers on “What’s Space Got to Do with It? Distance and Agricultural Productivity before the Railway Age” and “The Prehistoric Origins of European Economic Integration.”